Section 179 in 2026: How Financing Equipment Before Year-End Can Cut Your Tax Bill

Every fall, contractors ask us the same question: should I buy equipment before year-end to save on taxes? For 2026, the answer is worth a serious look — the Section 179 deduction limits went up again, and financed equipment still qualifies just like a cash purchase.

For more background, see our full guide to equipment financing, and our commercial equipment financing 101 guide.

What Section 179 Actually Does

Section 179 lets a business deduct the full purchase price of qualifying equipment placed in service during the tax year, instead of depreciating it slowly over several years. For 2026, the deduction limit sits at $2,560,000, with the deduction beginning to phase out once total equipment purchases for the year exceed $4,090,000, phasing out completely at $6,650,000. For the vast majority of contractors — buying one excavator, one dump truck, or even a handful of machines — the full deduction applies.

The Part Contractors Miss: Financed Equipment Still Qualifies

This is the detail that surprises a lot of business owners: you don't have to pay cash to claim Section 179. Equipment purchased with financing still qualifies for the full deduction in the year it's placed in service, as long as you own the equipment (this generally doesn't apply to straight operating leases where you never take ownership). That means a contractor can finance an excavator with a modest down payment, deduct the entire purchase price against this year's taxable income, and keep the rest of their cash for payroll, fuel, and materials instead of tying it up in a single equipment purchase.

Who This Matters Most For

General contractors, excavation and site-development subs, demolition contractors, and owner-operators running their own trucks are exactly who benefits most from timing an equipment purchase before December 31st. If you've had a strong year and know you'll owe real money at tax time, financing a piece of equipment you already needed and placing it in service before year-end can meaningfully reduce that bill while putting a working machine on your jobsite.

Why Financing Beats Renting Here Too

A rented machine gets you no Section 179 deduction and builds you no equity — you're paying full price every month for a machine you'll never own and can't write off the same way. Financing gets you both: a real tax deduction this year and a machine your business owns and keeps using for years after. BFC can move fast enough to help you close on financing before year-end deadlines, and we don't make you wait years before financing your next piece of equipment either — if this purchase sets you up to bid bigger jobs next year, we want to help you get there.

Financing Terms That Fit a Growing Business

Getting equipment financed shouldn't take weeks of paperwork while a job you already won sits waiting on a machine. BFC works with contractors across a wide range of credit situations — strong credit, thin credit history, even a rough patch a season or two back — because a slow stretch during a tough year doesn't define whether a contractor is a good long-term partner to lend to. We structure terms around how construction businesses actually make money: seasonal cash flow, staggered payment schedules, and terms that match the revenue timeline of the work you're financing the machine to do.

Whether you're financing your first piece of equipment or adding the fifth machine to an established fleet, the process is built to move fast, because a machine sitting on a lot while financing drags on is lost production for your business and lost opportunity for ours to help.

A machine that starts every morning and performs the way it should is worth more to your reputation than almost anything else in this business — a missed schedule because a rented machine broke down is how a contractor loses repeat work to someone else. Owning reliable equipment outright, instead of juggling whatever happens to be available at the rental yard that week, is part of what lets a growing contractor bid confidently on bigger jobs and actually deliver on the schedule they promised.

Ready to Put a Machine to Work for You?

Renting by the month or the week might feel easier today, but it never gets you anywhere — every dollar you hand to a rental yard is gone for good, and at the end of the job you're left with nothing to show for it but a receipt. Financing or leasing-to-own puts those same payments toward a machine your business actually owns, can keep running job after job, and can resell or borrow against down the road. And unlike a lender who tells you to wait five-plus years until this machine is paid off before you can even think about the next one, BFC can help structure funding for your next project while you're still paying this one down, because our job is helping your business grow, not just collecting a payment.

Ready to get started? Apply for equipment financing and see what you qualify for. Looking to buy? Browse our current equipment inventory for units ready to finance today. And if you've got a machine sitting idle, list it for sale through BFC for free and let us help you turn it into your next down payment. Or just head back to our homepage to see everything we do for contractors like you.